Saudi Arabia’s Public Investment Fund Acquires 15.2% Stake in ACWA Power

HSBC was the sole financial advisor to PIF and JP Morgan acted as the sole financial advisor to ACWA Power


The Public Investment Fund (PIF) of Saudi Arabia has acquired a 15.2 percent stake in International Company for Water and Power Projects (ACWA Power), a developer, owner, and operator of power generation and water desalination plants. PIF and ACWA Power jointly announced the acquisition.

As a result of the investment, PIF will become a 15.2 percent direct shareholder in ACWA Power and by taking into account the 9.78 percent ownership of its wholly-owned subsidiary Sanabil Direct Investments Company, PIF’s total shareholding directly and indirectly represents a 24.98 percent equity interest in ACWA Power.

The entire investment will be in the form of a capital increase and the proceeds will be used to support ACWA Power’s growth strategy and investment plan.

The investment is in line with the PIF program, to unlock new sectors and industries, to support and accelerate the development of innovative Saudi businesses and achieve strong long-term returns. It also underlines the strategic support PIF has provided to ACWA Power in funding its growth and PIF’s role in unlocking the broader sector as a significant investor in several utilities businesses.

The additional investment in ACWA Power reiterates PIF’s endorsement of the successful strategy and business model of ACWA Power.

“We see exciting growth potential for ACWA Power and are very pleased to support its development. ACWA Power is a strategic long-term investment for PIF which has a proven asset base and demonstrated track record of leading innovative projects domestically and internationally,” PIF has stated.

Paddy Padmanathan, Chief Executive Officer of ACWA Power, said, “The investment by PIF reflects its commitment to the Kingdom of Saudi Arabia’s energy transition plans of diversification of the fuel mix in power generation including the introduction of significant renewable energy capacity and the expansion of much needed additional power generation and desalinated water production capacity. While ACWA Power will continue to focus on reliably delivering electricity and desalinated water at the lowest cost, the ACWA Power also intends to leverage its domestic and international market-leading position to play a pivotal role in the Kingdom of Saudi Arabia’s energy transition plan, as evidenced by its recent successful bid for the Kingdom of Saudi Arabia’s first utility scale solar photovoltaics tender in the Kingdom of Saudi Arabia in February 2018.”

HSBC acted as the sole financial advisor to PIF and JP Morgan acted as the sole financial advisor to ACWA Power on the transaction.

In February 2018, ACWA Power bagged the power purchase contract for a period of 25 years at a new world record tariff of 8.781 halalas (~$0.234)/kWh to develop the 300 MW Sakaka project in the Kingdom.